Service Level Agreements

The convergence of voice, video, and data networks leads to the demand for toll-quality services equivalent to those delivered by legacy circuit-switched networks, but delivered on top of a packet-switched network. The ability to provide preferential, or guaranteed, service to certain traffic flows is known as QoS. QoS is designed to manipulate four key network characteristics that are analogous to a water pipe:

- Bandwidth = width of the pipe;

- Delay = length of the pipe;

- Jitter = variation in length of the pipe (i.e., delay variations);

- Packet loss = leaks in the pipe.

QoS is ultimately about the control of networks, about providing a network infrastructure that is responsive to the needs of all users, both inside and outside the organization. The overprovisioning of network resources, in the hope that full capacity will not be reached, has been a common approach with LANs. However, overprovisioning only addresses the need for increased bandwidth, while delay, jitter, and packet loss need to be addressed with other techniques.

The overprovisioning of bandwidth is not practical with WANs, where bandwidth is usually contracted with a carrier and the cost is much higher than with a LAN. It has become a common and desirable practice for the management of QoS to be defined by service-level agreements (SLAs).

Purpose of an SLA
The purpose of an SLA is to spell out the terms and conditions of a business arrangement between two or more participants. The SLA provides the "glue" for a good relationship, in which all parties may be winners. However, if participants have difficulty making and implementing commitments, the service agreement is bound to fail.

In a telecommunications systems environment, there will be a number of SLAs. For example, an internal SLA may exist between a service-providing department (e.g., IS) and a user department, or perhaps for a specific application for the organization. Another example may be an SLA within a single department, where two groups need to work together to meet a particular user need.

In most cases, an SLA is an external service agreement between an organization and its vendor. With telecom service agreements the content is not necessarily a strict legal document, but rather a statement of expectations. An SLA need not be technically detailed; it delineates "what," "when," and "(who," but not "how" or "why." You should avoid creating SLAs that are win-or-lose arrangements.

Contents of an SLA
A normal SLA will contain the following information:

1- Names of the partner organizations to the agreement;

2- Names of those persons who have authority to commit to the agreement;

3- Agreement commencement and termination dates, possibly also specifying regular review dates, at which the adequacy and currency of the agreement will be determined;

4- Details regarding what is to be delivered to whom, perhaps including when (but not how or why);

5- Details of any crucial elements that must be provided by assignees in order to meet commitments;

6- Service standards for delivery in terms of quality, quantity, and cost, where applicable;

7- Definitions of noncompliance;

8- Details on the escalation procedures required to resolve conflict, should it occur;

9- Details about the process involved in revising or edit the SLA;

10- Details of the process regarding agreement termination;

11- Details regarding penalties which would apply for nonperformance;

12- Implementation details.

Implementation of an SLA
SLA implementations can take two forms. Often a dry run or pilot test is held for a month or two, to ensure that the parties understand their commitments and can deliver as promised. On other occasions, implementation commences at a given point and revisions are processed through the terms of the SLA.

With all good SLAs the partners must have a positive attitude and a strong desire to make the agreement work. If the agreement fails, or creates negative feelings, then it is considered a management failure by all. The best SLAs are those that exist through mutual trust and personal relationships, rather than those where changes to the agreement seem to be going on perpetually.

Importance of an SLA
In the last few years, senior managers have led the move to using SLAs, both within organizations (i.e., between departments) and between organizations. SLAs are used in many contexts apart from the telecom business, but are especially crucial in the related areas of multimedia communications and supporting applications, such as ACD, CRM, and UM.

The popularity of extensive outsourcing arrangements, to allow organizations of all sizes to concentrate on their core competencies and to move away from service activities that are difficult to maintain (e.g., because of skilled personnel shortages), plays a large part in this greater interest in SLAs. This trend is consistent with the development of IP-Centrex services.